Survey: Obsolete Software Costs U.S. Cos. Billions

Obsolete and redundant software is a major drain on companies' information technology budgets, according to a survey by Business Performance Management Forum.

Among 226 IT professionals and C-level executives surveyed, more than 40 percent estimated that unwanted applications drain more than 10 percent of their IT budgets, while 10 percent estimated the real cost to be more than 20 percent, according to the report, "Software Drain or Business Gain: Assessing Application Value, Relevance and Cost to Your Company." Seventy percent of respondents said that their companies have redundant, deficient or obsolete applications on the network, and the problem is even more serious in companies with revenues over $500 million, BPMF said.

The survey also found that while nearly 77 percent of participants said that they are either dependent or extremely dependent on the performance of their software applications, 64 percent admitted that they aren't able to benchmark the value of their software investments.

While 63 percent said that business software helps their companies capture new business, and 61 percent rely on it to gain competitive differentiation, nearly half of all respondents gave their company low marks for the way that IT spending is aligned with strategic priorities and business needs. In addition, 40 percent conduct company-wide software audits only on an "as-needed basis," while 13 percent never conduct them at all.